Strategic Oil & Gas Ltd
TSX VENTURE : SOG

Strategic Oil & Gas Ltd

April 01, 2009 11:29 ET

Strategic Reports 2008 Year-End Reserves

CALGARY, ALBERTA--(Marketwire - April 1, 2009) - Strategic Oil & Gas Ltd. (TSX VENTURE:SOG) ("Strategic" or the "Company") wishes to announce the results of its independent reserve report as at December 31, 2008:

Highlights

- Proved reserves have increased 26% to 429,000 boe,

- Proved plus probable (P+P) reserves have increased 22% to 643,000 boe,

- Finding & development costs, including revisions and changes to future capital, were $15.87/boe Proved and $17.77/boe P+P based on unaudited capital spending of $2.4 million,

- Replaced production by 2.4 times on a Proved basis and 2.9 times on a P+P basis,

- Net asset value per share (basic and fully diluted) at December 31, 2008, based on a 10% discount rate was $0.36.

- Based on the Company's fourth quarter production of 177 boe/d, the reserve life index was 6.6 years on a Proved basis and 9.9 years on a P+P basis.

In 2008, the Company drilled two natural gas wells at Harmattan (Caroline) with a partner. The 10-8 well came on production in August, 2008 and has been producing at a rate of 1.5 mmcf/d gross (0.3 mmcf/d net). The well produces from the Mannville and Elkton zones. The second well was drilled in December and is expected to be tied-in in the second quarter from the Mannville zone. These two wells were the primary reason for the increase in reserves during 2008.

Reserves

The following tables summarize the Company's reserve information as prepared in accordance with National Instrument "NI" 51-101. The reserves for the Ferrier and Caroline properties in Alberta and the US properties in Wyoming were evaluated by GLJ Petroleum Consultants ("GLJ"). The reserves for the Northwest Alberta properties, including Steen River/Marlowe, Larne, Lessard and Bistcho were evaluated by AJM Petroleum Consultants. All reserves were evaluated using GLJ's January 1, 2009 forecasted pricing.



Reserves Summary-Company working interest before royalties

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Light/medium oil Natural gas NGL's BOE @ 6:1
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Mbbl MMcf Mbbl Mboe
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Proved producing 58 1,334 66 346
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Total proved 58 1,651 95 429
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Proved + Probable 112 2,421 127 643
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(1) Tables may not add due to rounding


Net Present Value of Future Net Revenues-Prior to provision for income
taxes, interest and G&A expenses

Net Present Value of Future Net Revenues before income taxes
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(in $ thousands) 0% 10% 15%
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Proved producing $10,425 $ 7,177 $6,241
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Total proved $12,713 $ 8,261 $7,093
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Proved + Probable $19,465 $11,118 $9,192
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(1) Values are net of abandonment liabilities.
(2) The net present values of future net revenues may not represent fair
market value.


Price Forecast

The following table summarizes the first five years of the price forecast
used to determine future revenues from the Company's reserves:

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WTI@Cushing Edmonton AECO Spot
Exchange rate $US/bbl Light $Cdn/bbl $Cdn/MMBtu
Year $US/$Cdn Crude oil Crude Oil Natural gas
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2009 $0.825 $57.50 $68.61 $7.58
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2010 $ 0.85 $68.00 $78.94 $7.94
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2011 $0.875 $74.00 $83.54 $8.34
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2012 $0.925 $85.00 $90.92 $8.70
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2013 $ 0.95 $92.00 $95.91 $8.95
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Additional information on the Company's reserves as required by NI 51-101 will be filed prior to April 30, 2009 on SEDAR (www.sedar.com).

Certain information regarding the Company contained herein may constitute forward looking statements. Forward looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although the Company believes that the expectations reflected in such forward looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. These statements are subject to certain risks and uncertainties, including but not limited to the geological and engineering risks attendant on all exploration or development well, and the fact that the Company may need to raise additional capital to fund further exploration, and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward looking statements. The Company's forward looking statements are expressly qualified in their entirety by this cautionary statement.

Barrel of oil equivalent ("boe") amounts may be misleading particularly if used in isolation. All boe conversions in this release are calculated using a conversion of six thousand cubic feet on natural gas to one barrel of oil (6mcf=1bbl), and is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the well head.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the contents of this news release.

Contact Information

  • Strategic Oil & Gas Ltd.
    Arn Schoch
    President
    (403) 870-1245 or Cell: (604) 780-9810
    Email: arn@helix.net